140 Million People Opened ‘Wallets’ for China’s Digital Yuan and Used it for Transactions Worth $9.7B

While 1.55 million merchants, so far, can accept payments in e-CNY, Chinese police cracked the first case of e-CNY used to launder money.


China’s digital yuan has been used to make transactions totaling around 62 billion yuan ($9.7 billion) so far, said a senior Chinese central bank official this week. Also, about 140 million people had opened “wallets” to use China’s central bank digital currency (CBDC) as of October.

Still, there is no official launch date for the digital currency, e-CNY, said Mu Changchun, the director-general of the digital currency institute of the People's Bank of China, at Hong Kong's “Fintech Week” conference.

Mu further said that 1.55 million merchants can accept payments using eCNY wallets, including retail, transportation, utilities, catering, and government services.

Growing Enquiry

Speaking at the same ‘Fintech Week,’ the Hong Kong Securities and Futures Commission (SFC) Deputy Chief Executive Officer and Executive Director Julia Leung said they have received “a number” of requests from local companies in recent months to offer crypto-related ETFs to their private bank and professional clients.

The SFC director also pointed out regulatory issues involved with these products, including whether crypto ETFs should face additional restrictions compared to traditional ETFs and if retail users are allowed to access these products through online brokers.

Leung didn’t comment on the regulator's decision on ETFs but said the agency is currently reviewing its regulatory regime for crypto to see if it is still “fit for purpose.”

Under the new regime, virtual asset service providers have to be licensed to operate in the region and can only offer their services to professional investors, those with a portfolio of over HK$8 million (US$1 million) or companies with more than $5 million in assets.

SFC-regulated fund managers can also invest up to 10% of their gross asset value in crypto, and if they wish to invest more, they can apply for a special license.

Money Laundering

In other news, Chinese police cracked the first case of e-CNY used to launder money, according to a local report. 11 suspects were detained in this case.

This was a case of telecommunications network fraud that occurred in Xinmi City, where the suspects called people to compensate them three times the original price of an item due to the product having quality problems. The victim followed the instructions and did multiple transfers, totaling more than 200,000 yuan, and then realized that he had been deceived.

The Criminal Investigation Brigade of the Public Security Bureau of Xinmi City found that payments were flowing to a specific electronic wallet, different from the previous one.

Investigators were able to apprehend the suspects after investigating the e-wallet, commercial banks, financial institutions, and third-party payment and settlement companies.

The money laundering criminal group reportedly used digital renminbi to launder money for the overseas fraud group hiding in Cambodia, said the authorities.

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